Forest economics is all about the role of wood and forest
use in our communities and society. It is NOT simply about money. Dollar
stocks and flows are measures of economic activity, not the definition.
Forests are an integral piece in the life-blood of many of our communities and are
essential to everyone. Try to imagine life without wood products! Or, think
about Michigan lifestyles without forests! Keep in mind that each of us uses about
4.5 pounds of wood EACH day. That's equivalent to about half a 2 by 4.

Wood is a prime environmental solution to many
of our raw material requirements. The following essays provide excellent background
about the economic, environmental, and ethical use of wood.Jim Bowyer,
University of Minnesota, Department of Wood and Paper Science.Patrick Moore, Co-founder of Greenpeace.

Not surprisingly, forest industries and wood-using
industries comprise one of the largest economic sectors in Michigan. The annual
monetary value exceeds nine billion dollars, and those figures
are from 1994! In comparison, the Gross Domestic Product (GDP = the value
of all goods and service generated within the state) is about $325 dollars. Just the
annual value of raw wood products delivered to Michigan mills
exceeds 530 million dollars (in 1994, Potter-Witter and
Stevens, 1996). Employment and value-added products (something made from raw
wood) was worth about 6.6 billion dollars in 1992 (Potter-Witter
and Stevens, 1996). Over 125,000 people work in these industries. Recent analyses by the
Michigan Forest Products Council show the size of the forest products sector
even larger.

You
will find differing values depending upon the analysis, but all of them are
large numbers which illustrate one of the important aspects of our forests . . .
a major driver in our state economy!

All these "facts" represent more than just
numbers. They represent livelihoods, communities, schools, families, and much more.
One of the best aspects of the forest industry is that it is dependent on raw
materials that are not only recyclable and reusable, but they are also renewable!
However, this page will deal mostly with some of the "cold, hard facts"
about Michigan's forest industry.

Once out of the forest, logs, pulpwood, and
chips are delivered to
a wide range of mills that process the wood into either a useable product or material that
will be used in the manufacture of other products.

Most
commonly, we think of sawlogs being sawn into lumber or peeled into veneer, and pulpwood
being made into paper pulp. These are primary wood-using
mills, and there are about 367 of them in Michigan. Secondary
manufacturers will take the lumber, veneer, and pulp, and make them into the nearly 900
different products made in Michigan. We have 1300 of these secondary manufacturers.

Wood-using mills are a valuable part of Michigan's forest
industry and come in a wide variety of types. They occur in each of Michigan's 83
counties. A "primary" wood-using mill utilizes raw
products from the forest (logs, chips, pulpsticks, etc.). Examples would be a
sawmill or pulp mill. A "secondary" wood-using mill uses
value-added products from primary wood-using mill. Examples would be paper mills or
furniture plants. There can be several secondary mill links in a wood product
"food chain". Michigan has about 345 primary and over 1,300
secondary wood-using mills. Additionally, there are over 850 producers
that manufacture logs, pulpwood, and other raw wood products.

Some mills are very large, such as the pulp and paper mills
owned by NewPage (formerly Mead-Westvaco and Mead Corporation) or Verso
Papers (formerly International Paper and Champion International). They employ thousands of
workers and consume large volumes of wood each year. However, most mills are small,
employing only a few workers.

Most mills are located in southern Michigan. Most
of the state wood producers (loggers, truckers, wood brokers, etc.) are located in the
north close to where most of the forest resource grows. Wood materials must be
transported to these mills. Over half of Michigan's forest industry is
involved with producing the raw wood products. The furniture industry is a large
part of the picture.

In many rural counties, forest industry is a critical
element in the local economies. Over 500 million dollars flows into smaller
northern towns just from the sale of logs and other raw wood products. Statewide,
value-added industries contribute another 6-7 billion dollars on an annual basis.

Compared
to Wisconsin and Minnesota, Michigan forests harvest less wood per acre. This is
part of the reason why Michigan's timber "surplus" is one of the highest in the
nation. The thought might be that we manage and harvest our forests less intensively
than our sister states. However, there are other possible explanations for this
ranking.

Michigan also has a different composition of forest types.
Further west, average annual rainfall drops off and forest composition changes.
Wildfire had an increasingly larger role in forest ecology closer to the
Great Plains, affecting forest composition.

Uneven-aged forest types, such as northern hardwoods
(maple-beech-yellow birch), occupy larger proportions of Michigan's forest scape than in
Wisconsin or Minnesota. These types are typically thinned on a regular
basis rather than clearcut. Thinning and selection harvesting produce less wood
volume per acre within the time frame of a decade or so. This is especially true of
our largely middle-aged northern hardwoods being managed to create uneven-aged stands from even-aged
stands left over from past logging practices.

Even-aged
forest types, such as aspen, red pine, jack pine, oak-hickory, and paper birch, become
more frequent as you move west. Even-aged types tend to mature and decline in
widespread "boom and bust" cycles. So, when the "boom" comes,
harvest is accelerated to minimize the "bust". This boom-and-bust cycle
has also been accentuated by our logging history and subsequent treatment of the land.
Much of our Lake States aspen, paper birch, and jack pine resources have reached
maturity.